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Guidewire Software, Inc. (GWRE) vs Paycom Software, Inc. (PAYC)

Guidewire Software, Inc. and Paycom Software, Inc. are both Software Application companies. Guidewire Software, Inc. is the larger, with a market value of $13.8B against $11.1B — 1.2× the size. Paycom Software, Inc. trades at the lower P/E: 23.8× against 101×. Guidewire Software, Inc. grew revenue faster over the last twelve months: 22.7% against 9.49%. Paycom Software, Inc. has the higher net margin (23.3% vs 9.44%) and the higher return on invested capital (36.2% vs 8.37%). Across the 22 metrics below, Paycom Software, Inc. leads on 16 and Guidewire Software, Inc. on 6.

Valuation

Metric GWRE PAYC Software Application median
P/E 100.97 23.79 25.90
P/S 9.56 5.21 3.04
P/B 11.82 16.13 2.60
Price to free cash flow 39.34 17.77 17.17
EV/EBITDA 67.52 14.15 15.48
EV/Sales 9.63 5.46 2.89
Earnings yield 0.99% 4.20% 0.00%
Free cash flow yield 2.54% 5.63% 1.98%

Profitability

Metric GWRE PAYC Software Application median
Gross margin 64.21% 0.00% 66.89%
Operating margin 10.16% 33.39% 0.00%
Net margin 9.44% 23.28% 0.00%
Free cash flow margin 24.31% 30.08% 5.77%
Return on equity 10.51% 42.21% 0.00%
Return on assets 5.26% 9.87% 0.00%
Return on invested capital 8.37% 36.20% 0.00%

Growth

Metric GWRE PAYC Software Application median
Revenue growth (TTM) 22.70% 9.49% 12.27%
EPS growth (last fiscal year) 101.23% (9.42%) 32.11%
Revenue growth, 5-year CAGR 14.70% 19.51% 14.34%
Net income growth, 5-year CAGR 0.00% 25.88% 0.00%

Health

Metric GWRE PAYC Software Application median
Debt to equity 0.57 1.06 0.02
Current ratio 1.79 1.06 1.53
Net debt to EBITDA (0.36) (0.50) 0.09

Dividend

Metric GWRE PAYC Software Application median
Dividend yield — 0.60% 1.10%
Payout ratio — 0.14 0.28

Size

Metric GWRE PAYC Software Application median
Market cap 13.83b 11.07b 487.58m

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